Vietnam-based Viva Land has agreed to buy a boutique hotel along Singapore’s Robinson Road for around S$240 million ($173 million) from local developer Royal Group, Mingtiandi has confirmed, with the acquisition potentially paving the way for a new integrated development in the city’s downtown core.
Based in Ho Chi Minh City, Viva Land, has agreed to purchase the 134-room So/ Singapore hotel at the corner of Robinson Road and Boon Tat Street for the equivalent of S$1.8 million per key, as first reported by the Business Times, with the transaction setting a new price-per-key record for a hotel in the city-state.
The boutique hotel is adjacent to the Robinson Point office tower which Viva Land acquired from SGX-listed builder Tuan Sing Holdings in 2020 with the two purchases giving Viva Land a combined 3,260 square metres (35,000 square feet) of commercial sites in the centre city.
The sale of the So/ Singapore, which has over 49 years remaining on its leasehold, was revealed just less than a week after another boutique hotel near Farrer Park station was reportedly sold for around S$86 million to a joint venture between JMD Holdings and TCRE Partners.
Back to Robinson Road
Opened in 2014, the So/ Singapore spans 80,190 square feet (7,450 square metres) making the acquisition equivalent to around S$2,993 per square foot of existing floor area. Viva Land had paid S$500 million to acquire Robinson Point two years ago with that project measuring 133,830 square feet of net lettable area.
On a price per key basis, the deal for the hotel opposite the Lau Pa Sat food centre exceeds the city’s previous high water mark for hotel values set when Japanese investment firm Daisho purchased the Westin Singapore hotel at Asia Square from a fund managed by MGPA (since acquired by BlackRock) for S$468 million in 2013. That property in Marina Bay sold for the equivalent of S$1.53 million per key.
Should Viva Land choose to combine the sites and redevelop as a mixed-use project incorporating at least 60 percent residential space, it could add build a new complex exceeding the combined 214,020 square feet in the two Robinson Road properties by 25 percent or more, under the CBD Incentive Scheme introduced by Singapore’s government in 2019.
Established in 2020 and helmed by former Capitaland veterans Eddie Lim and Chen Lian Pang, Viva Land is adding the So/ Singapore to its five projects across Singapore and Vietnam, including the Capital Place office complex in Hanoi which it purchased from CapitaLand Development for S$751 million in January.
Local news sites have linked the firm to Van Thinh Phat, a Vietnamese conglomerate founded by Truong My Lan.
Viva Land and Royal Group had not responded to inquiries from Mingtiandi regarding the transaction or any future development plans by the time of publication.
Royal Group had paid S$86 million to win the former TAS Building in a 2011 tender and is said to have invested S$130 million to redevelop the heritage building into a hospitality property.
The firm controlled by Asok Kumar Hiranandani also owns the 215-key Sofitel Singapore Sentosa Resort and the 62 villa Raffles Sentosa Resort, as well as the 267-room Doubletree hotel in Kuala Lumpur.
Picking Up Hotels
With visitor numbers only starting to recover after two years of travel restrictions, hotels in Singapore have recently become targets of investors looking for redevelopment opportunities.
On Thursday the Business Times reported that the 106-room Fortuna Hotel in Farrer Park is being sold for just less than S$86 million. A 50:50 joint venture between Singapore developer JMD Holdings and local property investment firm TCRE Partners is acquiring that property at the corner of Serangoon Road and Owen Road for around 13 percent less than the seller’s asking price of S$99 million less than two years ago.
In a report published last week, CBRE noted that the value of hotel deals surged 46 percent in 2021 compared to a year earlier, to $12.1 billion in value. The property agency is expecting the recovery trend to as governments relax travel restrictions.
“As the region’s borders reopen, hotels will be among the sectors to benefit as investor confidence strengthens and buyers seek assets providing attractive risk-adjusted returns,” the agency said.